The federal and municipal governments have teamed up to announce a new affordable housing project in central Etobicoke to address the extreme shortage in reasonably-priced rental housing.

Federal Housing Housing Minister Jean-Yves Duclos said the 259-unit project on Warrender Ave. is aimed at middle-class earners who don’t qualify for assisted housing but who can’t afford full market rents.

“That means that teachers, nurses, store clerks, construction workers — many find it impossible to live, work and make ends meet in our large urban centres,” Duclos said Thursday.

Mayor John Tory (Dave Abel, Toronto Sun)

A private developer, Princess Management, will receive $89 million in loans at a highly-competitive rate,”the minister said.

In exchange for the highly-competitive loan, the developer agreed to ensure that almost 80% of the units will be affordable for those making at or below 30% of the area’s median income, and that at least 62 of the units will remain affordable for 10 years.

Tory has promised to see 40,000 new affordable units built over the next 12 years.

“I look at this as a problem that probably will never be entirely solved but that we’ve got to make progress at minimizing it and making affordability something that is realistic for all the people that are going to keep coming to Toronto and for those, of course, who are already here,” Tory said.